Auriga Assumes Coverage On Broadcom With Buy Rating

According to Auriga, Broadcom (NASDAQ: BRCM) Buy rating is maintained.

Auriga reported that the price target is reduced to $50 from $55. “We significantly raise our previously above consensus 2011/12 top and bottom line estimates, as our checks are suggesting subdued opex growth for the near/mid-term, and we see continued strength in connectivity and Ethernet driven by secular trends, share gains and significant design wins. However, we reduce our price target to $50 from $55 as we see increased longer-term risks from competitive threats posed by Qualcomm's (QCOM, NR) baseband/connectivity integration efforts and also from Nokia's (NOK, NR) move towards Windows. We also lower our 2Q11 estimates as we see potential for Japan related supply-chain disruption in smart phones/tablets. We see recent weakness as an attractive buying opportunity, as we expect BRCM to grow at 15% CAGR through 2015, driven by share gains, entry into new markets, and end market growth.”

Broadcom closed yesterday at $38.12.